CAMBRIDGE, Mass.--(BUSINESS WIRE)--
Ironwood
Pharmaceuticals, Inc. (NASDAQ:IRWD) today provided an update on its
third quarter 2013 and recent business activities.

"This quarter, we continued to make good progress across our key value
drivers. LINZESS is performing well across the key leading indicators,
reinforcing the significant opportunity we see ahead. Our scientists
continue to advance the pharmacology of linaclotide and explore its
utility more broadly while also progressing our broader pipeline, and
our global partners are making important strides in bringing linaclotide
to appropriate patients worldwide," said Peter Hecht, chief executive
officer of Ironwood Pharmaceuticals, Inc.

Third Quarter 2013 and Recent Highlights

LINZESS®
(linaclotide)

LINZESS net product sales, as reported by Forest Laboratories, Inc.,
were $34.4 million in the third quarter of 2013.

More than 178,000 LINZESS prescriptions were filled in the third
quarter of 2013, resulting in more than 40% growth in total
prescriptions compared to the previous quarter, and more than 539,000
LINZESS prescriptions have been filled since the launch of LINZESS on
December 17, 2012, according to IMS Health.

To date, more than 80% of high prescribing gastroenterologists and
more than 50% of high prescribing primary care physicians have
prescribed LINZESS; approximately 1,000 physicians are writing their
first LINZESS prescription each week.

As of September 2013, approximately 80% of adult irritable bowel
syndrome with constipation (IBS-C) or chronic idiopathic constipation
(CIC) patients with commercial insurance had unrestricted access to
LINZESS and greater than 60% of adult patients with commercial
insurance have access to LINZESS at a copay of $30 per month or less
through formulary coverage or the LINZESS Instant Savings Program.

Ironwood received positive top-line data from a Phase IIIb clinical
trial conducted with Forest to evaluate the effect of LINZESS on
abdominal symptoms in patients with CIC and prominent abdominal
bloating. The average bloating score reported by these patients at
baseline was 7.1 on a 0 to 10 point scale. Data from the clinical
trial demonstrated that LINZESS dosed at 145 mcg in adult CIC patients
resulted in a statistically significant increase in bowel movements,
achieving the trial's primary endpoint. Data from the trial also
indicate that all 27 pre-specified secondary endpoints, including a
statistically significant reduction in abdominal bloating relative to
baseline in adult patients suffering from CIC, were achieved. Diarrhea
was the most commonly reported adverse reaction reported in the study.
Data showed a diarrhea rate of 5.9% and 16.9% in patients treated with
LINZESS at the 145 mcg and 290 mcg doses, respectively, versus 2.3% in
placebo-treated patients, and a 1.3% and 5.0% discontinuation rate due
to diarrhea in patients treated with LINZESS at the 145 mcg and 290
mcg dose, respectively, versus 0.6% in placebo-treated patients.

Ironwood and Forest continue to explore additional development
opportunities to work with the FDA to strengthen the clinical profile
of LINZESS within its indicated population and to expand the product
label for additional approved patient populations and indications, as
well as to explore the potential for linaclotide-based combination
products. The companies expect to initiate a Phase IIa clinical trial
of LINZESS in adult patients with opioid-induced constipation during
the first half of 2014, and to continue working with the FDA to
establish an appropriate plan to study LINZESS in the pediatric
population.

Linaclotide (Rest of World)

CONSTELLA® (linaclotide) is currently available to adult
IBS-C patients in multiple countries in Europe, and Ironwood's
European partner, Almirall, S.A., will continue to launch CONSTELLA in
additional European countries.

Ironwood and AstraZeneca AB began enrolling patients in a Phase III
clinical trial of linaclotide in adult patients with IBS-C in China.
The trial is expected to be completed in the first half of 2015.

In addition to exploring additional linaclotide development
opportunities, Ironwood is leveraging its pioneering understanding of
linaclotide's pharmacology and mechanism of action, guanylate
cyclase-C (GC-C) agonists, cyclic GMP, and symptomatic diseases to
advance other programs in its pipeline, which include early
development candidates and discovery research efforts focused on
gastrointestinal disease, central nervous system disorders, allergic
conditions and cardiovascular disease.

Corporate and Financials

Total Revenues. Revenues were approximately $4.9 million in the
third quarter of 2013. This consisted of $3.4 million in sales of
active pharmaceutical ingredient (API) and $1.5 million in the
amortization of deferred revenue associated with consideration
received from Ironwood's collaborations with Astellas and AstraZeneca.
LINZESS net product sales are recorded by Forest and are not included
in Ironwood's total revenues (refer to the LINZESS U.S. Collaboration
Expense Calculation at the end of this press release).

Operating Expenses. Operating expenses were approximately $53.3
million in the third quarter of 2013. This consisted of $23.0 million
of research and development expenses, which included approximately
$2.3 million in non-cash share-based compensation expense, and $30.3
million of selling, general and administrative expenses, which
included approximately $2.9 million of non-cash share-based
compensation expense.

Collaboration Expense. Ironwood reported $6.2 million in
collaboration expense in the third quarter of 2013. Ironwood records
its share of the net profits and losses from the sales of LINZESS in
the U.S. on a net basis and presents the settlement payments as
collaborative arrangements revenue or collaboration expense, as
applicable.

Interest Expense. Interest expense was $5.3 million in the
third quarter of 2013 in connection with the $175 million debt
financing executed in January 2013.

Net Loss. Ironwood reported a net loss of $61.8 million, or
$0.51 per share, in the third quarter of 2013.

Cash Position. Ironwood ended the third quarter of 2013 with
approximately $242 million of cash, cash equivalents and
available-for-sale securities. Ironwood used approximately $58 million
of net cash for operations during the quarter.

Financial Guidance. Ironwood today reiterated its financial
guidance for the Forest and Ironwood total 2013 sales and marketing
expense for LINZESS to be in the range of $250 to $300 million.
Ironwood also reiterated its guidance for its 2013 non-linaclotide
research and development expense to be in the range of $60 to $75
million.

Ironwood will host an Investor Day on December 12, 2013 to further
discuss its corporate strategy, including an update on the
commercialization of LINZESS, a discussion around linaclotide
opportunities in additional populations and indications, and its
overall R&D efforts.

Conference Call Information

Ironwood will host a conference call and webcast at 8:30 a.m. Eastern
Time, on Tuesday, October 22, to discuss its third quarter 2013 and
recent business activities. Individuals interested in participating in
the call should dial (877) 643-7155(U.S. and Canada) or (914)
495-8552 (international) using conference ID number 75229614. To access
the webcast, please visit the Investors section of Ironwood's website at www.ironwoodpharma.com
at least 15 minutes prior to the start of the call to ensure adequate
time for any software downloads that may be required. The call will be
available for replay via telephone starting today at approximately 11:30
a.m. Eastern Time, running through 11:59 p.m. Eastern Time on October
29, 2013. To listen to the replay, dial (855) 859-2056 (U.S. and Canada)
or (404) 537-3406 (international) using conference ID number 75229614.
The archived webcast will be available on Ironwood's website for 14 days
beginning approximately one hour after the call has completed.

About LINZESS (linaclotide)

LINZESS is the first and only guanylate cyclase-C (GC-C) agonist
approved by the FDA for the treatment of both irritable bowel syndrome
with constipation (IBS-C) and chronic idiopathic constipation (CIC) in
adults. LINZESS is a once-daily capsule that helps relieve the abdominal
pain and constipation associated with IBS-C, as well as the
constipation, infrequent stools, hard stools and incomplete evacuation
associated with CIC. The recommended dose is 290 mcg for IBS-C patients
and 145 mcg for CIC patients. LINZESS should be taken at least 30
minutes before the first meal of the day.

LINZESS is thought to work in two ways based on nonclinical studies.
LINZESS binds to the GC-C receptor locally, within the intestinal
epithelium. Activation of GC-C results in increased intestinal fluid
secretion and transit and a decrease in the activity of pain-sensing
nerves in the intestine. The clinical relevance of the effect on pain
fibers, which is based on nonclinical studies, has not been established.

In placebo-controlled Phase III clinical trials of more than 2,800
adults, LINZESS was shown to reduce abdominal pain in IBS-C patients and
increase bowel movement frequency in both IBS-C patients and CIC
patients. Improvement in abdominal pain and constipation occurred in the
first week of treatment and was maintained throughout the 12-week
treatment period. Maximum effect on abdominal pain was seen at weeks 6-9
and maximum effect on constipation occurred during the first week. When
a subset of LINZESS-treated patients in the trials were switched to
placebo, they reported their symptoms returned toward pretreatment
levels within one week, while placebo-treated patients switched to
LINZESS reported symptom improvements. LINZESS is contraindicated in
pediatric patients up to 6 years of age. The use of LINZESS in pediatric
patients 6 through 17 years of age should be avoided. In nonclinical
studies, administration of a single, clinically relevant adult oral dose
of linaclotide caused deaths in young juvenile mice. LINZESS has not
been studied in pediatric patients. In adults with IBS-C or CIC treated
with LINZESS, the most commonly reported adverse event was diarrhea.

Ironwood and Forest Laboratories, Inc. are co-promoting LINZESS in the
United States. Linaclotide was also approved by the European Commission
for the treatment of adults in the European Union with IBS-C and is
marketed under the brand name CONSTELLA® through a license
agreement between Ironwood and Almirall, S.A. Ironwood also has
partnered linaclotide with Astellas Pharma Inc. for development and
commercialization in Japan and with AstraZeneca for development and
commercialization in China.

About CONSTELLA (linaclotide)

Linaclotide is a Guanylate Cyclase-C receptor agonist (GCCA) with
visceral analgesic and secretory activities. Linaclotide is a 14-amino
acid synthetic peptide structurally related to the endogenous guanylin
peptide family. Both linaclotide and its active metabolite bind to the
Guanylate Cyclase-C receptor, on the luminal surface of the intestinal
epithelium. Through its action at GC-C, linaclotide has been shown to
reduce visceral pain and increase GI transit in animal models and
increase colonic transit in humans. Activation of GC-C results in an
increase in concentrations of cyclic guanosine monophosphate (cGMP),
both extracellularly and intracellularly. Extracellular cGMP decreases
pain-fiber activity, resulting in reduced visceral pain in animal
models. Intracellular cGMP causes secretion of chloride and bicarbonate
into the intestinal lumen, through activation of the cystic fibrosis
transmembrane conductance regulator (CFTR), which results in increased
intestinal fluid and accelerated transit.

Linaclotide was discovered by scientists at Ironwood and is marketed in
Europe by Almirall through a license agreement between the two companies.

About Ironwood Pharmaceuticals

Ironwood Pharmaceuticals (NASDAQ:IRWD) is committed to the art and
science of making medicines, from discovery through commercialization.
We're focused on three goals: transforming knowledge into medicines that
make a difference for patients, creating value that will inspire the
continued support of our fellow shareholders, and building a team that
passionately pursues excellence. Our first product, linaclotide, is
approved in the United States and Europe. Our pipeline priorities
include exploring further opportunities for linaclotide, leveraging our
deep expertise in functional gastrointestinal disorders, and advancing
programs in other areas such as allergic conditions, cardiovascular
disease, central nervous system disorders and other conditions defined
by patient symptoms. Ironwood was founded in 1998 and is headquartered
in Cambridge, Mass. Connect with us at www.ironwoodpharma.com
or on Twitter at www.twitter.com/ironwoodpharma
to learn more about Ironwood. Information that may be important to
investors will be routinely posted in both these locations.

LINZESS® and CONSTELLA® are trademarks owned by Ironwood
Pharmaceuticals, Inc.

Important Safety Information

WARNING: PEDIATRIC RISK

LINZESS is contraindicated in pediatric patients up to 6 years
of age. Use should be avoided in pediatric patients 6 through 17
years of age. In nonclinical studies, administration of a single,
clinically relevant adult oral dose of linaclotide caused deaths
in young juvenile mice.

Contraindications

LINZESS is contraindicated in pediatric patients up to 6 years of age.

LINZESS is contraindicated in patients with known or suspected
mechanical gastrointestinal obstruction.

Warnings and Precautions

Pediatric Risk

LINZESS is contraindicated in pediatric patients up to 6 years of age.
In nonclinical studies, deaths occurred within 24 hours in young
juvenile mice (1 to 3 week-old mice; approximately equivalent to human
pediatric patients less than 2 years of age) following administration
of one or two daily oral doses of linaclotide.

Use of LINZESS should be avoided in pediatric patients 6 through 17
years of age. Linaclotide did not cause deaths in older juvenile mice
(approximately equivalent to humans age 12 to 17 years). Although
there were no deaths in older juvenile mice, given the deaths in young
juvenile mice and the lack of clinical safety and efficacy data in
pediatric patients, use of LINZESS should be avoided in pediatric
patients 6 through 17 years of age.

Diarrhea

Diarrhea was the most common adverse reaction of LINZESS-treated
patients in the pooled IBS-C and CIC double-blind placebo-controlled
trials. Severe diarrhea was reported in 2% of LINZESS-treated
patients. The incidence of diarrhea was similar in the IBS-C and CIC
populations.

Patients should be instructed to stop LINZESS if severe diarrhea
occurs and to contact their healthcare provider, who should consider
dose suspension.

This press release contains forward-looking statements. Investors are
cautioned not to place undue reliance on these forward‐looking
statements, including, but not limited to, the potential for LINZESS as
a treatment option for adults in the United States suffering from IBS-C
and CIC, the addition of new physicians who are prescribing LINZESS,
Ironwood's and its partners' anticipated non-clinical and clinical
development activities for linaclotide and their associated timelines,
Ironwood's intended activities for the product candidates and early
development programs in its pipeline, the anticipated launch timeline
for CONSTELLA in Europe, Ironwood's and its partners' ability to bring
linaclotide to appropriate patients worldwide, the amount Ironwood and
Forest anticipate spending on sales and marketing expenses for LINZESS
in 2013 and the amount Ironwood anticipates spending on non-linaclotide
research and development expenses in 2013.Each forward‐looking
statement is subject to risks and uncertainties that could cause actual
results to differ materially from those expressed or implied in such
statement. Applicable risks and uncertainties include the risks that the
market acceptance of LINZESS in the U.S. is not as anticipated, Ironwood
or its partners are unable to manufacture or distribute a sufficient
commercial supply of linaclotide, the rate of new physician adoption of
LINZESS begins to decrease, Ironwood and Forest increase or modify their
plans for the sales and marketing campaigns for LINZESS in the U.S. and
such modifications result in an increase or a decrease in the associated
expenses, Almirall is unable to obtain sufficient pricing or
reimbursement for CONSTELLA in countries in Europe or it chooses to
launch CONSTELLA on a different timeline, serious adverse events arise
in patients that are deemed to be related to linaclotide treatment, the
incidence or severity of diarrhea in patients treated with linaclotide
is higher than expected, efforts to strengthen the clinical profile of
linaclotide within its indicated population and advancements in the
further development of linaclotide in additional patient populations or
indications or in linaclotide-based combination products do not proceed
as expected, or the development of other products or early development
programs in Ironwood's pipeline do not proceed as expected, as well as
risks related to the difficulty of predicting regulatory approvals and
the acceptance of and demand for new pharmaceutical products. Applicable
risks also include those that are listed in Ironwood's Quarterly Report
on Form 10‐Q for the quarter ended June 30, 2013, in addition to the
risk factors that are listed from time to time in Ironwood's Annual
Reports on Form 10‐K, Quarterly Reports on Form 10‐Q and any subsequent
SEC filings. Ironwood undertakes no obligation to update these
forward‐looking statements to reflect events or circumstances occurring
after this press release. These forward‐looking statements speak only as
of the date of this press release. All forward‐looking statements are
qualified in their entirety by this cautionary statement.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

September 30,

2013

December 31,

2012

Assets

Cash, cash equivalents and available-for-sale securities

$

242,390

$

168,228

Accounts receivable, net

3,086

1,487

Inventory

20,561

6,699

Prepaid expenses and other current assets

9,789

8,026

Total current assets

275,826

184,440

Property and equipment, net

37,231

37,537

Other assets

12,786

7,930

Total assets

$

325,843

$

229,907

Liabilities and Stockholders' Equity

Accounts payable and accrued expenses

$

30,736

$

48,561

Current portion of capital lease obligations

1,115

261

Current portion of deferred rent

2,776

2,735

Current portion of deferred revenue

5,074

3,381

Total current liabilities

39,701

54,938

Capital lease obligations

3,427

308

Deferred rent

9,519

11,593

Deferred revenue

12,684

18,024

Notes Payable

174,650

—

Other liabilities

1,653

992

Total stockholders' equity

84,209

144,052

Total liabilities and stockholders' equity

$

325,843

$

229,907

Condensed Consolidated Statements of Operations

(in thousands, except share and per share amounts)

(unaudited)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2013

2012

2013

2012

Revenue

$

4,932

$

96,413

$

17,850

$

123,265

Cost and expenses:

Cost of revenue

2,021

—

6,670

—

Research and development (1)

23,016

23,453

79,862

85,201

Selling, general and administrative (1)

30,264

22,846

94,508

59,264

Collaboration expense

6,182

2,506

42,074

7,662

Total cost and expenses

61,483

48,805

223,114

152,127

Loss from operations

(56,551

)

47,608

(205,264

)

(28,862

)

Other income (expense), net

(5,224

)

27

(15,562

)

93

Net income (loss)

$

(61,775

)

$

47,635

$

(220,826

)

$

(28,769

)

Net income (loss) per share—basic

$

(0.51

)

$

0.44

$

(1.93

)

$

(0.27

)

Net income (loss) per share—diluted

$

(0.51

)

$

0.42

$

(1.93

)

$

(0.27

)

Weighted average number of common shares

used in net income (loss) per share —basic

120,768,893

107,266,823

114,140,821

106,036,522

Weighted average number of common shares

used in net income (loss) per share —diluted

120,768,893

114,337,327

114,140,821

106,036,522

(1) Non-cash share-based compensation expensesincluded
reflected in the condensed consolidatedstatements of
operations are as follows:

Research and development

$

2,349

$

2,648

$

7,274

$

6,676

Selling, general and administrative

2,850

2,487

8,017

6,236

LINZESS U.S. Collaboration Expense Calculation1

(in thousands)

(unaudited)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2013

2012

2013

2012

LINZESS net sales

$

34,444

$

-

$

67,709

$

-

Commercial costs and expenses2

63,276

7,420

201,945

22,314

Net profit (loss) on sales of LINZESS

$

(28,832

)

$

(7,420

)

$

(134,236

)

$

(22,314

)

Ironwood's share of net profit (loss)

$

(14,416

)

$

(3,710

)

$

(67,118

)

$

(11,157

)

Ironwood's selling & marketing3

$

8,234

$

1,204

$

25,044

$

3,495

Ironwood's collaboration expense

$

6,182

$

2,506

$

42,074

$

7,662

1 Ironwood collaborates with Forest on the development
and commercialization of linaclotide in North America. Under the
terms of the collaboration agreement, Ironwood receives 50% of the
net profits and bears 50% of the net losses from the commercial sale
of LINZESS in the U.S. The purpose of this table is to present
calculations of the Ironwood's share of net profit (loss) generated
from the sales of LINZESS in the U.S. and the Ironwood's
collaboration expense; however, the table does not present the
research and development expenses related to LINZESS in the U.S.
that are shared equally between the parties under the collaboration
agreement.

2 Includes cost of sales incurred by Forest as well as
selling and marketing costs incurred by Forest and Ironwood that are
attributable to the cost-sharing arrangement between the parties.

3 Includes Ironwood's selling and marketing costs
attributable to the cost-sharing arrangement with Forest.